DEFINITION of ‘Overcast’
A forecasting error that occurs when estimating volumes of items such as future cash flows, performance levels or production. Overcasting produces an estimation that is above the realized value.
BREAKING DOWN ‘Overcast’
Overcasting is caused by a variety of forecasting factors. The main factor that results in overcasting is using the wrong inputs. For example, when estimating the net income of a company for next year, you may overcast the amount if you underestimate costs or overestimate sales.